The retail industry was ripe for change as soon as direct-to-consumer (D-to-C) and the digital world grew in popularity almost a decade ago. However, in 2021, retail e-commerce sales amounted to nearly $4.9 trillion, a figure only forecasted to grow by 50 percent over the next four years, reaching $7.4 trillion by 2025. While change was the theme of the last couple years, the e-commerce boom came at a good time because consumers weren’t able to shop in person and retailers had to find alternative ways to sell and be successful.
At the same time, the growth of e-commerce has seen its fair share of issues, including website crashes, customer support issues, supply chain disruptions, and loss of customer loyalty due to nonpersonalized experiences. With Prime Day, back to school, Black Friday/Cyber Monday and even early holiday sales driving up engagement, these issues are only expected to increase unless an organization’s underlying tech infrastructure is set up to handle the influx.
Two areas that play a key role in building a modern e-commerce tech infrastructure are access to data, both real-time and first-party, along with omnichannel communications.
Utilizing Real-Time and First-Party Data
For years, the news of third-party cookies disappearing has rattled marketers. Many wondered how they would be able to keep up with changing consumer behavior. It’s clear that we aren’t going back to a world of using third-party data, and now, retailers are seeking alternative methods to achieve personalization. One place they should be looking at is first-party data, pulling the information that's already inside of email conversations, social media followers, app usage, website traffic, etc. This is data that customers already opt into providing.
Among the many benefits of utilizing first-party data, perhaps one of the most relevant for retailers is being able to monitor trends more closely. By looking at data holiday after holiday, retailers can be more prepared by providing the items that consumers actually want and ensure that they're being delivered quickly and efficiently. While consumers are always looking for personalization, first-party data allows retailers to tailor items to the right consumers while also being able to stock and monitor supply chains accurately.
In addition to first-party data, real-time data is also necessary. Real-time data streaming involves using the data at the time it comes in. That can include data within emails or other data across communication channels. Accessing data in real time and leveraging it to build automated workflows and personalized experiences is key around major retail holidays.
Omnichannel Communications Plays a Major Role in Tech Infrastructure
While data fuels decision making, that data is only as good as the communication that goes with it. Retailers can access tons of data from various sources, but if there isn’t an easy way to access it internally or even externally it’s useless. When it comes to communications, it’s necessary to utilize omnichannel communication — i.e., all communications channels, whether it be email, phone, SMS, chat or others, are all integrated to provide a seamless customer and employee experience.
Specifically as it relates to e-commerce, conversations, interactions, purchases and more start in one channel or application and finish in another. While many retailers are looking to use data to personalize experiences for customers, they also need to use communications to do the same. And in order to stay on top of evolving customer behavior, retailers need to capture a full 360-degree view of their customers through omnichannel communication. In fact, in a recent survey we conducted at Nylas, we found that businesses are leaning heavily on omnichannel communications data for boosting customer engagement, increasing operational efficiency, and driving return on investment.
The summer only marks the very beginning of a season full of shopping for consumers everywhere. Between the countless holidays during the year, retailers have a responsibility to ensure their tech infrastructure is set up to be scalable as e-commerce is set to continue to rise in the years to come.
More than ever before, retailers are sharing the market with numerous competitors. Consumers are flooded with options and decision making is nearly impossible. As it stands right now, tech infrastructure isn’t built for this level of e-commerce growth. But with the use of data and omnichannel communications, retailers will be on the right path to handle spikes in commerce and increased demand as it happens.
Gleb Polyakov is the CEO and co-founder of Nylas, the communication platform-as-a-service (CPaaS) company that empowers businesses worldwide to unlock the true power of their communications data.